Adjacent innovations: boon or bane for corporates?

COMPANIES are constantly planning the growth of their revenues and profits. And the best means of growing both revenue and profit bases is by creating a succession of innovations as a part of their product mix. Enlightened companies tend to manage this process by setting up an innovation portfolio managed in many cases by an innovation office.

When companies identify innovations to pursue, they often are comfortable creating new products or services that are adjacent to their current offerings. Adjacent innovations can contribute to the creation of a new product line thereby increasing the width of the product mix, and the length or depth of a current product line.

Adjacent innovations are generally defined as new products and services offered to existing customers, or current products and services offered to new customers. The implicit understanding is that current products and services often require some customisation to meet the needs of new customers.